Orbitz 2014 Annual Report Download - page 76

ORBITZ WORLDWIDE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
76
The table below shows the changes in the liability for unrecognized tax benefits during the years ended December 31,
2014, 2013 and 2012:
Years Ended December 31,
2014 2013 2012
(in thousands)
Balance at January 1, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,569 $ 4,106 $ 3,429
Increase as a result of tax positions taken during the prior year . . . . . . . . . . . . . . — 21 952
Decrease as a result of tax positions taken during the prior year. . . . . . . . . . . . . . (209)(433)(285)
Impact of foreign currency translation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (12)(125) 10
Balance at December 31, . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,348 $ 3,569 $ 4,106
The total amount of unrecognized benefits that, if recognized, would affect our effective tax rate was $3.3 million, $3.5
million and $0.9 million at December 31, 2014, 2013 and 2012. During the next twelve months, we anticipate no reduction to
this liability due to the lapsing of statutes of limitations.
We recognize interest and penalties related to unrecognized tax benefits in income tax expense. We recognized interest
and penalties of $0, during each of the years ended December 31, 2014, 2013 and 2012. Accrued interest and penalties were
$0.7 million and $0.7 million at December 31, 2014 and 2013, respectively.
We file income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. A number of years
may elapse before an uncertain tax position, for which we have unrecognized tax benefits, is audited and finally resolved. We
adjust these unrecognized tax benefits, as well as the related interest and penalties, in light of changing facts and circumstances.
Settlement of any particular position could require the use of cash. Favorable resolution could result in a reduction to our
effective income tax rate in the period of resolution.
The number of years with open tax audits varies depending on the tax jurisdiction. Our major taxing jurisdictions include
the United States (federal and state), the United Kingdom (federal) and Australia (federal). With limited exceptions, we are no
longer subject to income tax examinations by tax authorities for years before 2010.
With respect to periods prior to the Blackstone Acquisition, we are only required to take into account income tax returns
for which we or one of our subsidiaries is the primary taxpaying entity, namely separate state returns and non-U.S. returns.
Uncertain tax positions related to U.S. federal and state combined and unitary income tax returns filed are only applicable in
the post-acquisition accounting period. We and our domestic subsidiaries currently file a consolidated income tax return for
U.S. federal income tax purposes.
11. Equity-Based Compensation
We issue share-based awards under the Orbitz Worldwide, Inc. 2007 Equity and Incentive Plan, as amended (the “Plan”).
The Plan provides for the grant of equity-based awards, including restricted stock, restricted stock units, stock options, stock
appreciation rights and other equity-based awards to our directors, officers and other employees, advisors and consultants who
are selected by the Compensation Committee of the Board of Directors for participation in the Plan. There are 25,600,000
shares of common stock available for issuance under the Plan, subject to adjustment as provided by the Plan. As of
December 31, 2014, 4,291,197 shares were available for future issuance under the plan.